Retailers expecting good Christmas trade

Most retailers believe they will fare no worse than last year over the crucial Christmas trading period as they offer an ‘exceptional’ number of offers to entice shoppers as consumers splash out ahead of January’s VAT rise, a report said today.

Most retailers believe they will fare no worse than last year over the crucial Christmas trading period as they offer an ‘exceptional’ number of offers to entice shoppers as consumers splash out ahead of January’s VAT rise, a report said today.

A survey on trading by the British Retail Consortium found 64 per cent of businesses expect festive sales to be the same or better than in 2009, but that leaves 36 per cent braced for a fall.

The looming rise in VAT to 20 per cent means consumers are bringing forward purchases, according to 71 per cent of retailers who responded to the survey. However, more than 80 per cent of retailers expect January’s VAT hike to adversely affect sales in the new year.

Stephen Robertson, director general of the BRC, said: "It’s reassuring to see a majority of retailers believe Christmas sales will be at least as good as last year, even if a third say they will be worse. But, considering inflation is now at 3.2 per cent, growth of anything less than that would be a real-terms fall.

"Promotions have hit a new level of intensity, retailers believe the next VAT rise is bringing sales forward and Christmas is usually a time when people spend despite their economic worries but December could prove to be the ninth month in a row of weak year-on-year growth."